Judge Rejects Fraud Claim in Purchase of Pat & Oscar’s

A San Diego County Superior Court judge has ruled that the Sherman Oaks-based parent of Sizzler restaurants did not commit fraud when it purchased the Pat & Oscar’s chain from one of its founders three years ago.

Michael Green, corporate counsel for Worldwide Restaurant Concepts Inc., said Friday that he believed the ruling by Judge John Meyer cleared the way for Worldwide to obtain the remaining 12.8% of Pat & Oscar’s it doesn’t already hold.

But the plaintiff, John Sar- kisian, co-founder of the San Diego-based “fast-casual” chain and its former president and chief executive, plans to appeal the ruling.

Sarkisian sued Worldwide last June, claiming, among other things, wrongful termination and fraud related to Worldwide’s taking a majority stake in Pat & Oscar’s in August 2000 for $16 million. The suit came three months after he was dismissed. Part of the case centered on whether Worldwide had the right to buy Sarkisian’s shares.

The ruling, issued Wednesday, followed a three-week bench trial. Sarkisian’s San Francisco-based attorney, E. Bob Wallach, plans to appeal the judge’s decision not to allow a jury trial.

Sarkisian “wanted the conduct of WRC to be evaluated by a jury that had life experience,” Wallach said.

Shares of Worldwide closed Friday at $2.99, up 19 cents, on the New York Stock Exchange.